Reprinted with permission from Schanel and Associates, CPA. www.schanelcpa.com. Original Post: October 04, 2019 When an investor sells a stock or mutual fund that produces a loss, this capital loss reduces taxable income by first offsetting any capital gains, and then by reducing taxable income up to $3,000. Net capital losses in excess of…
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As the markets continue to move up and down and as the media continues to have a field day playing with our emotions, it is no wonder that many investors find themselves questioning what lies ahead. While no one can predict what the markets will do or how people will react to the news of…
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A central tenet of our investment philosophy is diversification. Furthermore, we advocate for “real diversification”, which means owning thousands of stocks in companies of all sizes (large and small), geography (U.S. and non-US) and investment style (value and growth). This type of diversification represents the only “free-lunch” there is in investing. But real diversification also…
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In 1906, statistician Francis Galton attended a livestock fair where villagers were invited to guess the weight of an ox. No villager successfully guessed the correct weight, but Galton noticed that the average of all the guesses was 1,197 pounds — the exact weight of the ox. A famous experiment asked 56 students to guess…
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In Part 1 of this series, a brief list of the advantages and disadvantages of investing in publicly traded equities vs. direct real estate was provided. In this article, I will try to more directly answer the question, “which is better, stocks or real estate”? First of all, that is probably the wrong question to…
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Some investors choose to invest their savings in stocks while other others favor investing in directly real estate. Below is a brief list of the advantages and disadvantages of each. Advantages of Directly Owned Real Estate Leverage: The primary advantage of real estate is the ability to use leverage. Leverage is an investment strategy where…
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We all know that risk and return go hand-in-hand. As investors, we are encouraged to think about how much risk we can/want to assume and then build a portfolio that reflects our risk tolerance and objectives. But, investment risk is not a straightforward concept. There are two, broadly different kinds of investment risks: avoidable, concentrated…
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Stock prices change as new information becomes available. It’s not surprising that many investors believe that it is crucial to follow financial news carefully and then act quickly on news that might be relevant to their investments. While this may sound like a good idea, the reality is that you cannot expect to consistently improve…
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Doctors write prescriptions. Auto mechanics perform tune-ups. Lawyers prepare briefs. Financial advisors help you manage your money. Ultimately, it’s that simple. But like any other profession, we sometimes have a funny way of saying it. Following are a few of the most common terms related to money management. Assets Your assets sustain your financial being…
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As I discussed in a previous article, Dimensional and Vanguard are similar but are different in some key respects. While neither fund family relies on forecasting or individual security analysis, Vanguard funds are index funds while Dimensional funds are not. Both fund families are great options for investors. However, Dimensional provides several advantages that may…
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